Economic Rent

A major city just doubled the annual fee for hot dog push carts that had exclusive rights to a spot just south of a major museum of art to $288,000...why would anyone pay this much for a push cart license? Who is obtaining the economic rent for the lucrative push cart location? How much economic profit is the push cart owner most likely earning?

Solution Preview

People would pay this much for a push cart license because they are expecting a much higher economic profit ...